Cuts shatter Waterford

Waterford Crystal, the glass- making arm of Waterford Wedgwood, is seeking to cut 500 jobs and impose pay cuts as part of a move to reduce costs in the face of recession.

The move is a further blow for the city of Waterford in Ireland's County Wexford, which has been associated with heavy leaded crystal cut glass for centuries. Waterford Wedgwood has already decided to produce its three latest lines in Germany and Portugal.

Feelings are running high. Waterford Corporation, the city's local authority, is taking legal action to see if the Waterford name can rightly be applied to glass produced on the Continent. Last week there was a huge turnout for a demonstration of support for the factory's workers, which was addressed by the city's mayor, Tom Browne. The Associated Transport and General Workers Union is threatening to picket stores in the United States that sell the glass.

Five years ago the company employed 3,200 workers - almost half the city's industrial workforce. The life of the city depended on Waterford Crystal and the glassware carried the name of Waterford around the world. After the latest round of redundancies, only 1,400 jobs will be left.

While there is no doubting the high quality of its produce, made in the city since the 17th century, the company says it is no longer competitive. In the past five years, Waterford Crystal has lost Ir pounds 81.3m ( pounds 79m). More than 70 per cent of the glass is sold in the US, and the weak dollar is exacerbating the problems.

Patrick Galvin, chairman and chief executive, told employees recently that moving production out of the city was an obvious and hard economic fact. 'If Waterford Crystal cannot produce its products to sell at a competitive price and make adequate profits, then something has to give. We either produce at a competitive price, or buy the products at a competitive price from some other factory, or go out of business.'

A spokesman for the company said he did not believe customers would be deterred by the glass being produced outside Ireland. 'Waterford is a brand name. Market research indicates that for many people the brand name is not linked to a city in Ireland, but a concept of crystal with its beauty and intrinsic qualities.'

Waterford's announcement rounded off a dismal week of job losses, coming on top of last month's Irish unemployment record of 290,725, or 17.5 per cent of the workforce.

About 100 jobs are to go at a factory owned by Wang Laboratories, the US computer firm that went into bankruptcy earlier in the week. Pulse Engineering, the US electronics company, has also announced 125 redundancies and Airmotive Ireland, an Aer Lingus subsidiary that overhauls jet engines, cut 138 jobs.